Sunday, July 15, 2012

Change in mobile handset market makes new entry difficult for Jolla

Last week we could read rumors about Nokia drop-outs Jolla, launching new handsets based on the discarded Nokia/Intel MeeGo OS or some kind of Linux derivative. These rumors stoked predictable excitement among people longing for the good old days of Nokia as well as general interest in the tech community. 

But so much have changed in the past few years in the mobile industry which makes success, on a scale larger than a small dedicated community, for new entrants like Jolla increasingly difficult.

There are two major trends that have contributed to this change.

1. The mobile industry has changed from being hardware driven with a touch of software to an industry where the hardware is taking the back seat in the user engagement relationship. Today, the hardware of smartphones or tablets only exist to serve the purpose of displaying software or enable actions by software. The handsets barely have buttons anymore and all interaction between the user and the device happens at the OS or App level.

2. The software in smart phones (OS and Apps) is becoming part of an ecosystem of software, devices and services that consists of smartphones, tablets and PCs where everything is glued together by cloud services. Today, there are effectively three ecosystems like this. Apple, Google and Microsoft.

This means that the days of "building a better smartphone" are gone (which Nokia is an example of) unless you work within the existing ecosystems.

Alternatively, if you plan to enter this business, you better have a plan to disrupt these ecosystems and become "the next big thing". Only entering to make a great MeeGo phone probably will not be enough to make it big, no matter how great the phone or the OS is.

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